Qantas Emirates alliance on historic take off

Updated
April 01, 2013 08:30:00

The first Qantas flight under it's newly approved alliance with Emirates Airlines is scheduled to touch down in Dubai this morning. The partnership is being described by Qantas as a seismic shift in the global aviation industry. The alliance sees Singapore dumped in favour of Dubai as the traditional Kangaroo Route stopover to London.

TONY EASTLEY: Qantas' partnership with Emirates Airlines, which was approved by the competition watchdog just last week, is being described by Qantas as a "seismic shift" in the global aviation industry.

The first Qantas flight under its new tie-up with Emirates will touch down this morning in Dubai.

Under the partnership, Qantas will no longer stop-over in Singapore but will use Dubai on its "Kangaroo Route" to London.

ALAN JOYCE: It's a big moment for Qantas, probably one of the biggest moments in our 92 year history. But already we can see that our customers, our employees and our share holders are reacting unbelievably positively to the Emirates alliance. It's going to be great for us, great for tourism in Australia and great for aviation in general.

PETER RYAN: You've referred to this being a seismic shift in global aviation, but at the same time it is a shift that is critical to the survival or the viability of Qantas international.

ALAN JOYCE: Yes, I think we know that Qantas international to Europe has struggled for some time because of the competition from now over 32 different carriers, whole carriers. We now have over 30 destinations in Europe compared to five one stop destinations previously.

We've cut the average time down to the 10 top destinations by two hours fifteen minutes, and our customers are coming back to us in droves, seven times the amount of bookings we had this time last year. This is working and it's a great start to a great partnership.

PETER RYAN: But will this be enough to get Qantas international back into profit permanently and to stop terminal decline?

ALAN JOYCE: Absolutely. We believe that Qantas international will get to break even in financial year 15. Of course Qantas domestic, jet stars and other frequent flyer business's are very profitable. So getting Qantas international back to break even is the first step.

PETER RYAN: What were the options if the ACCC had vetoed the deal with Emirates last week?

ALAN JOYCE: Well you know Qantas has been going through a lot of alternatives; we worked with British Airways for a long time, we've been talking to other carriers, trying to do deals previously. There wasn't many alternatives left, but the best alternative is the one we've ended up with because this partnership is made in heaven for us. We couldn't get a better carrier to team up with us, we're a better complementary network.

PETER RYAN: There must have been quite a few nervous people at Qantas as the ACCC decided what to do.

ALAN JOYCE: We take the process for granted with the ACCC. They took us through a rigorous process, a six months process. They took a lot of data, a lot of assessment, a lot of information, and at the end of the day they came out with what we thought was obviously the right conclusion. Our consumers are already benefiting out of this and it's clear this is good for competition.

PETER RYAN: How good is the Emirates deal though for travellers given that at the moment booking a flight on Emirates to Amsterdam or Manchester for example, is significantly cheaper than booking on Qantas?

ALAN JOYCE: We are working through them now and there will be a complete alignment of airfares between Emirates and Qantas and that will happen over the next few weeks because part of the joint venture is to have the exact same airfares between both carriers.